Cyprus Mail

A settlement could see another 2,500 ships flying Cyprus flag

Thomas Kazakos, head of Cyprus Shipping Chamber

A settlement of the Cyprus problem could boost the island`s commercial fleet to new levels, as 2,500 ships currently under management by Cyprus-based companies could be registered in the Cypriot registry, Cyprus Shipping Chamber Director General Thomas Kazakos said in an interview with CNA.

The Cypriot registry currently ranks 10th in the world and 3rd in the European Union with 1,763 ships flying the flag, despite the embargo on Cypriot-flagged ships imposed since 1987 by Turkey. Cyprus has a highly developed ship-management sector, the second largest in the world, with 2,500 ships under management by Cypriot-based firms.

After a settlement, these ships could register with the Cypriot registry “overnight,” Kazakos said.
“Without a political settlement in place, without the lifting of Turkey’s embargo and without exploiting our natural wealth we are managing 2,500 ocean-going ships. You can imagine the numbers that we will have to manage (after a settlement),” he added.

Kazakos said a settlement could automatically bring about the end of the embargo which he calls the Cyprus registry`s “Achilles heel.”
“With the announcement of a settlement to the Cyprus problem automatically the embargo would be lifted. As it was imposed unilaterally and illegally in 1987, it could be unilaterally lifted with one phone call by the Turkish Prime Minister,” he said.

Moreover, he noted, the Cyprus shipping sector could benefit from a stable environment that would emerge from a Cyprus settlement, as well as from the energy developments in the region and holiday cruises that seem to shift their focus from the Caribbean to the West Mediterranean. “A Cyprus settlement could trigger developments in utilising the multicultural East Mediterranean from the holiday cruises sector,” he added.

Kazakos said the Cyprus maritime administration should reflect on the industry`s performance and called for the drafting of medium to long-term national maritime policy, noting that the growth of the island`s registry which has been stable for approximately 15 years goes hand in hand with the further development of the island`s maritime administration.

He praised the current Transport Minister`s determination to promote the island`s shipping sector, recalling that he authorised a private firm to compare the Cyprus maritime cluster with other competitive jurisdictions whereas another study concerning the restructuring of the Transport Ministry and the Department of Merchant Shipping (DMS) is underway.

“Both studies point out that the DMS and the broader maritime administration should be modernised further to be able to catch up with the fast-moving developments in global shipping and to reflect the fact that Cyprus has the 10th largest fleet in the world,” he said.
“We cannot continue operating with the structures of a registry established in 1963, when Cyprus ranked 160 or lower in the world, while currently Cyprus is at such high levels both quantitatively and qualitatively,” he told CNA.

Replying to a question, he said that there were proposals under consideration by the ministry suggesting the separation of the DMS into a more flexible and independent unit that would cover issues such as ship registering, attracting clients and servicing and a second technocratic unit responsible for adapting with EU legislation or drafting national policy.

The CSC Director General pointed out that the shipping industry has weathered the storm of the three-year financial crisis as Cyprus is close to exiting its financial assistance package. No shipping companies left the island, Kazakos said.

“The shipping industry in these past three years remained loyal to Cyprus, no company has left the island. On the contrary, we saw some companies establishing offices here and we noted a stabilisation in terms of ship orders and new ship-management,” he said.
He added that the quarterly reviews carried out by Cyprus lenders (the EC, the ECB and the IMF) marked the acknowledgment of Cyprus` competitive tonnage tax system approved by the EU in 2010.

Responding to a question, Kazakos noted that Greek ship-management firms, prompted by the protracted financial crisis in the country, have been making inquiries over the Cypriot maritime industry and some companies had opened maritime offices to the island.
He stressed that the industry`s standing goal is to attract more quality companies that have their base and physical presence in Cyprus, which would in turn create more job positions on the island. (CNA)

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